As if corporations suddenly became greedy over the last couple of years but haven't been over the previous four decades. Corporations purpose is to maximise profits. To expect otherwise is a fools errand.
The original article is. The whole thing is presented as if it's some moral failure on the part of CEO's. Their only solution is price controls. There isn't one mention of breaking up the huge number of monopolies which dominate nearly every area of commerce.
All of those stimmy checks had to end up somewhere. Classical economics predicted the consequences of the Covid monetary response. It’s been textbook.
And yet we want to blame everything else except the actual causes.
That requires convincing investors the business is actually profitable (which is unrelated to the actual profitability of the venture)
The mature businesses dial up the greed when there is no competition and dial it down to crush threats. Once the threat is extinguished, up the dial goes again.
Along with all your startup costs, you will be competing against entrenched businesses willing to run at a temporary loss to bleed you dry. They can afford to do this because greed will pay after you are dead.
Capitalism does not create efficient competitive markets offering good value to consumers, government intervention does.
You’ve just described what is called “competition”. Having to lower prices to keep up with competitors.
Also, if there is a clear winning pattern of a single player takes all market, that’s super attractive to competitor investors because they only need to outlast your warchest.
What you’ve described is a very unstable game theoretic condition and it’s basically a non-issue everywhere in the US except for markets with regulatory capture (i.e. high government regulation).
I challenge you to point out an example of a one grocery-store city where that strategy has worked to keep competitors out.
Suppose a larger company is selling a product that competes with yours at a loss so as to undercut you due to other sources of profit. Do you think that sort of competition is fair? Does that result in the best product winning the most market share?
> I challenge you to point out an example of a one grocery-store city where that strategy has worked to keep competitors out.
Not the GP, but recommend The Wal-Mart Effect by Charles Fishman.
Second, it's exactly that kind of differentiation (offering a niche product that the larger, more generic stores don't want to) that makes it easiest to avoid being undercut and run out of business by larger players.
Now, if you said you had several different small local grocery stores thriving without any specific niche, that would be somewhat more surprising.
There are no "mom and pop" grocery stores in my area. We have "Metro" or "Express" versions of the mega chains instead. You can stand outside one and see two others and there won't be a single independent until you get into a different area that the chains don't consider sufficiently profitable.
https://www.macrotrends.net/stocks/charts/KR/kroger/profit-m...
Actually Publix does very well at 7-8% and it’s the largest employee owned company in the US.
https://www.barrons.com/visual-stories/what-publix-can-teach...
But when every other price is changing it becomes easier to change your price. And so suddenly you get 20 years of cost increases in a single jump.
And yes, we've noticed it, and so have people around us. My in-laws have been frequently heard complaining about price increases on products (their grumbling tends to start with how the price has increased since last year, then go on to declare what they remember paying for it in about 1965...).
We've also had rampant shrinkflation during that time. Remember, for instance, how ice cream used to be regularly sold in half-gallons? But now is instead sold in 48oz tubs, without any particular acknowledgement of the change.
But when the price increases aren't localized to one specific store, it doesn't matter that people get annoyed at it. Worst case, they'll just start buying less of the thing.
In 2022 you complain about everything going up in price.
Prices have certainly risen across the board more quickly and noticeably in the last year or so than previously. That doesn't mean that I haven't noticed prices rising broadly for the past 20 years.
Maybe you haven't. I don't know. I wouldn't presume to tell you what your experiences are.
That still allows growth to a dangerous size. A more simple solution tgat avoids worrying about details would be to limit maximum size in general, to guarantee that there is competition.